Smithson, Inc is a manufacturer of lead crystal glasses. The standard direct mat

Question

Smithson, Inc is a manufacturer of lead crystal glasses. The standard direct materials quantity is 0.7 pound per glass at a cost of $0.50 per pound The actual result for one month's production of 7,400 glasses was 1.3 pounds per glass, at a cost of S0.30 per pound. Calculate the direct materials cost variance and the direct materials efficiency variance Select the formula, then enter the amounts and compute the cost variance for direct materials and identify whether the variance is favorable (F) or unfavorable (U) Direct Materials Cost Variance Select the formula, then enter the amounts and compute the efficiency variance for direct materials and identify whether the variance is favorable (F) or unfavorable (U) Direct Materials Efficiency Variance

Explanation / Answer

Answers

(Standard rate per pound – Actual cost per pound) x Actual Quantity of pounds = DMC Variance

( $ 0.5 - $ 0.3) x (1.3 x 7400)pounds = $ 0.2 x 9620 = $ 1,924 FAVOURABLE

(Standard quantity of pound – Actual Quantity of pounds) x Standard rate per pound

[ ( 0.7 x 7400 glass) – (1.3 x 7400) ] x $ 0.5 per pound

= (5180 – 9620) x 0.5 = - 2220

= $ 2,220 Unfavourable.

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.